Opinions Remain Split on Risks of Subprime IO Loans
October 29, 2004
Think interest-only loans made to subprime borrowers are riskier than those made in the prime market? Well, you may be wrong. In fact, a new report by analysts at Friedman Billings Ramsey suggests that subprime lenders have corrected a potentially significant design flaw that could increase the risk of “payment shock” for conforming borrowers.